The Norris Group Hard Money shares the latest headlines in the investing, Realtor, lender, builder, and mortgage industries every weekday. We then collect the news and share the top headlines via our videos every Friday.

"Last month, the median home price in Southern California ($485,000) posted its smallest year-over-year price gain, 6.4%, since July 2000, according to the Los Angeles Times. It's taking longer to sell a house, thanks to increasing mortgage rates, fewer speculators, and homeowners trying to sell before prices fall further, the article says. The areas that saw the smallest price appreciation in May were the first ones to see skyrocketing price tags during the boom, the Los Angeles Times says. For instance, last month, San Diego County's median home price went up a mere 0.4% to $490,000 from $488,000, and Ventura County's median price rose 3% to $586,000, the article says. However, the paper says, three counties reached record-breaking median prices in May: Los Angeles (which rose 10.9% from the year before to $509,000), Riverside County (which had a rise of 9.4% to $417,000) and Orange County (which saw an increase of 7.6% to $635,000)."

"The unexpected increase in new home sales could have an effect on monetary policy. The Federal Reserve is widely expected to raise short-term interest rates again when it meets Wednesday and Thursday, extending a two-year credit tightening cycle in an effort to restrain inflation. But the course of the housing market could be a major influence on future decisions."

The median price of an existing home in California increased 8 percent in May and sales decreased 21.1 percent compared with the same period a year ago, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today.

"One out of three Americans worries that rising monthly payments – especially property taxes and energy costs – will force them to sell their home and buy a less expensive one, according to the fourth annual National Housing Opportunity Pulse, a survey released today by the National Association of Realtors®."

South Florida Sun-Sentinel - "Real Estate Bubble""'The boom is over, but don't expect big drops in real estate prices, Realtors say': David Lereah and the rest of his buddies at the National Association of Realtors must think our minds have popped along with their precious real estate bubble. "

"The world has seen speculative frenzies come and go, and history tells us that when a bubble pops, it results in dire economic circumstances. If you don't believe me, just ask anyone who was around in Japan when their housing bubble burst in the early 1990s. Back then, prime Tokyo real estate was going for around $139,000 a square foot! When their bubble burst, what followed was a crash in their stock market and economic stagnation for over a decade. Just because we have sunshine and beautiful beaches doesn't mean it can't happen here."

Monday, June 26, 2006

"You can learn a lot about what market's hot and what's not by looking up how much U-Haul charges for rentals of moving trucks to and from different cities. If U-Haul charges a lot to go to a certain city, it means lots of trucks are heading there. The city is popular and trucks that are leaving it are deadheading--going back empty. On the other hand, U-Haul gives better deals on trucks that are going to unpopular cities, because it needs to get more trucks to those cities to handle outbound trips."

"It’s bad news when dismal reports on the residential real estate market are revised downward. Well, that’s just what Ed McKelvey of Goldman Sachs recently did when he re-examined his housing sector estimate from his mid-January report “On Track for a Downturn in Housing (1/13/06)."

"As for the decline in single-family permits, he said production remains solid in most of Southern California, but starts are likely to be significantly below last year’s level in San Diego, the San JoaquinValley, the Sacramento region, and the Bay Area."

Inman - "Housing slowdown affords builders a breather" (6-22-06)"While all builders will feel the impact of a slower housing market, Dobron said the lull will allow builders to catch their collective breath after a frenzied spell of sales."

Many article say the builders need to keep building to keep up with demand and that now is still the time to buy. This is the first time I've read that builders are looking forward to a a "collective breath." I can't imagine they look forward to lower revenues and laying off staff they can't afford.

"Home sales in Southern California slowed for the sixth month in a row, making last month the slowest May since 1999. Homes are appreciating in value at their slowest pace in almost six years, a real estate information service reported."

DQNews.com - "Bay Area home sales continue to drop, prices reach new peak" (6-21-06)"A total of 9,064 new and resale houses and condos were sold in the nine-county region last month. That was up 8.4 percent from 8,358 for April, and down 19.8 percent from 11,308 for May last year, according to DataQuick Information Systems."

CARealEstateJournal - "Real Estate Industry in for a Soft Landing" (6-21-06)"LOS ANGELES According to the University of California, Los Angeles Anderson Forecast mid-year report, the California economy is poised at a tipping point."

With foreclosures on the rise in many parts of the country, Inman News examines the legal risks of investing in foreclosed properties at auction, describing the most common legal problems that arise and explaining how two investors had to fight in court to keep the property they purchased at auction after the former owner raised legal challenges."

Inman.com - "U.S. housing starts drop 3.8%" (6-20-06)"The rate of housing completions dropped 10.1 percent from May 2005 to May 2006, while building permit activity fell 8.5 percent and housing starts were down 3.8 percent in that time, the U.S. Census Bureau and the Department of Housing and Urban Development announced today."

"Southern California slowed for the sixth month in a row in May, falling 11.7 percent compared to May 2005. It was the region's lowest sales total for the month since May 1999, according to DataQuick Information Systems, a real estate information service."

"Long overdue reform of the Federal Housing Administrationâ€™s single-family mortgage insurance program will provide homebuyers an affordable alternative to higher cost loans and help bridge the gap in minority homeownership, Thomas M. Stevens, president of the National Association of Realtors"

Real Estate Journal - "Record-Breaking Housing Boom May Be Nearing a Close" (6-20-06)" The recent housing boom is the biggest the United States has ever seen, but its underlying reasons may have been psychological, economist Robert J. Shiller said on Friday. New data also suggest the market might be at the end of a cycle, he added."

"About 11% of home sellers last year used "alternative" brokers (ones offering flat fees or other forms of discounting), up from less than 2% in 2002, according to surveys by Real Trends, a publishing and consulting firm."

"An upbeat housing report was in focus Tuesday. The Commerce Department said housing starts rebounded 5% to 1.96 million units in May after an upwardly revised 1.86 million in April. That's slightly stronger than expected, says Action Economics, but any market impact may be offset by a 2.1% decline in building permits."

"The report suggests the housing market is slowing, but not crashing, analysts say. 'We view this morning's data as further evidence the housing market is in a downturn, but that it is not headed for collapse,' explains Carl Riccadonna, an economist at Deutsche Bank Securities. 'Nonetheless, the housing market is an important leading indicator of the overall economy, and the fact that it is slowing tells us that both consumption and overall growth are also likely decelerating.'"

"Graduation is in the air. With years of rapid appreciation and sellers waiting only days for multiple offers, it is time for the Orange County real estate market to officially graduate to a buyer’s market. The county’s inventory continued to climb from 5.16 months just two weeks ago to 5.68 months today. There are now 14,261 homes on the market with 2,512 homes placed into escrow within the prior 30 days. Compared to last years 1.34 month inventory at this time of year, there are 8,644 additional homes on the market and 1,651 fewer homes placed into escrow within the prior 30 days. The difference is night and day."

"How should a Seller approach the market? Hopefully potential sellers have read the WARNING label, “This market is for SERIOUS sellers only and NOT the market to test the waters.” Given the 14,261 home active inventory and only 2,512 homes placed into escrow within the prior 30 days, that means that 11,749 sellers will most likely not successfully sell their home over the next month. Only 17.6% will be successful. Sellers need to buckle their seatbelts and expect a long ride. Selling a home is no longer a quick process and could take months."

Follow link for full article from the Executive Vice President of ReMax. I'm not sure how long this link will stay live so please read ASAP.

"Though the jury is still out on the risks of payment-option and interest-only mortgages, the CFA findings suggest that lenders are hardly reserving them for high-income, high-credit-score applicants. In an economic squeeze, some of these loans could prove highly toxic – a prospect almost certain to weigh heavily in the financial regulators' forthcoming new guidelines."

Thursday, June 15, 2006

"Observing that the proposed framework would last for at least seven years and as many as nine, Howard said that NAHB’s analysis indicates the pact has the potential to seriously disrupt the lumber market by increasing and destabilizing prices, causing production bottlenecks as Canadian producers fight for limited market share, and instigating supply shortages as firms delay shipments in anticipation of a change in duties."

"But while the large number of condo conversions being sold may go some way towards explaining why the median sales price dropped so much, analysts cautioned that it doesn't fully explain DataQuick's statistics."

"There's no possible way prices fell that much in one month," said Chris Thornberg, a senior economist at the University of California, Los Angeles Anderson Forecast. "It's just not possible."

Wednesday, June 14, 2006

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending June 9. The Market Composite Index, a measure of mortgage loan application volume, was 571.9, an increase of 7 percent on a seasonally adjusted basis from 534.4 one week earlier. On an unadjusted basis, the Index increased 17.9 percent compared with the previous week but was down 34.3 percent compared with the same week one year earlier."

"The two government-sponsored companies, both of which have been roiled by accounting scandals in recent years, already have been under pressure from lawmakers and regulators who want their combined multitrillion-dollar mortgage holdings to be reduced. The administration has long been critical of the two companies, and officials have pointed to the accounting scandals to bolster their case that the massive mortgage portfolios are improperly managed and pose a risk to the financial system."

"Other stipulations of the so-called "anti-flipping" regulations are aimed primarily at quick resale of new homes. They state that only the owner of record may sell to a person obtaining FHA mortgage insurance for the loan. In other words, the arrangement can't involve the sale or assignment of a sales contract on a property. If a resale does occur between 91 and 180 days, the lender can be forced to obtain a second appraisal based on a resale threshold percentage established by the FHA. For example, if the home price rose by more than 50 percent within a five-month period, the FHA could ask for the new, independent appraisal."

Tuesday, June 13, 2006

Real Estate Journal - "Move Over, McMansions: Microhouses Are on the Rise" (6-14-06)Living in a tiny home, as opposed to doing yoga in it or using it for vacations, often appeals to people who want simpler lives that leave less of an ecological "footprint." Small houses require less fuel for heating and cooling, fewer building resources and are much easier to clean. V2World Chief Executive Tim Russell says his company designed their houses on the premise that people in the U.S. eventually might have to move to smaller spaces due to demographic pressures and land exhaustion.

Yahoo.com - "Why the Rich Get Richer" (6-13-06)"All over the U.S. there are stories of a rise in real estate foreclosures. Many people who took those exotic mortgages -- borrowing 125% of home value or choosing adjustable-rate mortgages -- are struggling to make their payments, and some aren't making it."

"The number of foreclosures escalated throughout Southern California, rising 29.09 percent since January 2006, according to Default Research, a real estate research company for foreclosure properties."

About Me

Bruce Norris is an active investor, hard money lender, and real estate educator with over 30 years experience. Bruce has been involved in over 2,000 real estate transactions as a buyer, seller, builder and money partner.

Renowned for his ability to forecast long-term real estate market trends and timing, the release of TheCalifornia Comeback in 1997 gained him much notoriety and its accuracy of the extensive report led many California investors to financial freedom. His January 2006 release, The California Crash, is an in-depth look into the California market correction and the statistics behind Bruce’s predictions. His latest award winning report, Category 5, goes into great detail why Bruce isn’t ready to call California Comeback 2 and what the real estate community should expect in the coming two years as the market continues its correction.

Bruce speaks and debates throughout California and has been a guest speaker at the California Builders Industry Association, California Association of Mortgage Bankers, The Financial Executives Networking Group, the Southern California Appraisal Institute, the Apartment Owners Association, the Real Estate Research Council, numerous California Realtor associations, the local Chamber of Commerce, and several local and national investment clubs. In late summer of 2008, Bruce hosted the I Survived Real Estate 2008 fundraiser bringing together top industry segment leaders to discuss the current state of California real estate market which benefited the Susan. G. Komen for the Cure Foundation.

Bruce is host of The Norris Group Real Estate Radio Show on KTIE 590am where he interviews real estate industry leaders and economists. Guests have included Frank Nothaft with Freddie Mac, Peter Schiff of Euro Pacific Capital, Leslie Appleton-Young and Joel Singer with C.A.R., Alan Nevin with the CBIA, RealtyTrac, PIMCO, PMI Group, REDC, HUD, the National Auctioneers Association, and the Center for Responsible Lending to name a few. For a complete list of past guests, visit the website at www.TheNorrisGroup.com. The show won a Platinum Hermes Creative Award in 2009.

Bruce has contributed articles to many real estate magazines and newsletters including RealtyTrac’s Foreclosure Newsletter, The Business Press, Creative Real Estate Magazine, The Orange County Register, AOA Magazine, and the Daily Commerce. He has also been featured in The Wall Street Journal, Fox Business News, The New York Times, Good Morning America, the Los Angeles Times, Fortune,Mortgage Banker Magazine, Money Magazine, Reuters, Associated Press, The Orange County Register, The Tribune, and numerous others.